Corporate charity?

June 21, 2007

I was emailed this article today on the partnership between AMWAY and UNICEF. While part of me wants to applaud the movement towards Corporate Social Responsibility (CSR) there is something about this article- and partnership- that just doesn’t sit right.

Partly it is the images of beauty products and western models placed next to images of “poor” women and children. As the person who sent the article noted- “maybe it is the juxtaposition of products related to western preoccupations with preventing aging, with a basic need -water – which reminds me of the fact that many people around the world would love to age…ie to live a long, healthy life, rather than dying due to unclean water, preventable diseases etc.”

I have to wonder how the €320,000 Amway raised in 2005 in response to the Asian tsunami disaster compares to their corporate profits for that year. Perhaps I’m too cynical but it does seem to be the social justice equivalent of “greenwashing”. The article states it well (emphaisis mine however) that “a business can serve its interests best by behaving in an ethical and socially responsible manner.” Amway’s work with UNICEF is clearly being used for PR purposes, and therefore it’s motivation and the true value of it’s work is questionable. Who is making the most profit out of the arrangement?

What do you think?

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7 Responses to “Corporate charity?”

The “clearly being used for PR purposes” thesis might have some validity, except what evidence is there to support it? The link to the article you provided wasn’t an Amway site and is some 7 years old? Amway has done no press releases I know of about it, heck, most Amway IBOs, especially outside of Europe, don’t know about the UNICEF/Amway partnership. This is not a *new* partnership, it’s been ongoing for many years. In addition, groups of IBOs (independent business owners) within Amway also support many many causes. One group, Network 21, is the largest sponsor of children for World Vision. There’s a small mention made of this on the N21 website (www.n21corp.com), but will you find any press coverage? No.

This is a pattern of behaviour by Alticor (parent company), which has been involved in CSR since the company began as Amway 50 years ago. It’s first product in 1959 was an environmentally friendly cleaner. More than a third of it’s world headquarters in Ada, Michigan is a certified wildlife habitat. It’s stopped testing animals decades before it became fashionable, and removed CFCs from it’s products before most people had ever even heard of them. Ingredients for it’s nutrition products are grown on certified organic farms. And on and on and on ….

Alticor does now have a website dedicated to many of it’s efforts with children, but who knows about the website? There’s been no press releases about it. http://www.alticoronebyone.com if you’re interested (and no, I don’t work for amway or alticor).

I’ve heard similar theses about things like the Gates Foundation, run by Bill and Melinda Gates. Yeah, yeah – it’s all just about PR and tax breaks. But as a former health promotion and education researcher, I’ve looked it up. Do you know that WHO estimates the Gates Foundation saves around 10000 lives *a day*?

There’s too much cynicism in today’s world, and not enough support for those who do the right thing, not for PR, not for sales – but because it’s the right thing.

What percentage of your time do you contribute? To what? Why? Why not more?

Not that I need answers. We all do whatever we do for our own reasons.

However, I have found that the people who question the motivation of others who contribute their own time and their own money to the various causes, charities, churches and other non-profit activities are usually justifying their own failure for doing so.

Having taught economics for many years, I am amazed at the poor quality of economic education in this country. People who have no idea as to the definition of “profit” are offended that others make a profit, but are also upset that they are not paid more money for their own work.

In summary — celebrate the good that is being done by others, as well as yourself, for whatever the reason.

Thank you Emet and IBOfightback for your thought provoking replies. I must admit to firing off this post in response to the article without really doing any background research. The article was sent by a Professor of Development Studies whom I trust, and I posted it here as I thought it highlighted well some issues about Corporate Social Responsibility (CSR) that I am concerned about.

As I stated in the first paragraph I would like not to be cynical and to applaud the phenomenon of CSR. I’m sure there are many corporations (maybe even Amway) who are going great work. But my reservations still stand.

From a free market perspective, a corporation exists principally to return a profit. This means that CSR activities must contribute to the companies profit or they risk becoming a liability (I’ve also heard it is against the law, or at least corporate ethics, for company directors to engage in activities that would reduce profit?). From this springs the cynics argument that CSR programmes exist largely for PR purposes, to raise a companies profile and reputation. While a CSR may well be set up from purely humanitarian or compassionate reasons, I believe that the nature of capitalism means that it will always be subject to ethical and moral questions that require careful thought.

A companies social responsibility programmes must be seen in the light of their other corporate practices. Companies that give to developing nations in the form of aid donations must make extra effort to ensure they are not then taking through sweatshop labour, environmental damage, unethical marketing and so on.

I haven’t done a lot of research on Amway, and given how busy I have been, am not likely to do more, however I think some critical light on their partnership with UNICEF is not inappropriate. If the programme is sound then it will stand up to the criticism (especially from very small bloggers like me!).

Emet- I’ll celebrate the good when I know it is good. I will admit to not giving as much as I ought lately, mostly due to a kind of paralysis related to too much critical thinking! I have however spent several years working in developing nations, have completed a research-based Masters degree in Development Studies and now work for a non-profit organisation providing health care to low income earners, so I think I am making a contribution. My criticism comes from a cynicism based partly on experience and partly on all that study.

IBOfightback- Thanks for some background on Amway. If what you say is correct then it is worth being proud of. I do think though that the fact Amway has the one by one website, easily accessible from the Amway homepage, speaks for itself. There is an element of PR there. The Amway homepage is one of the places potential IBOs and customers are likely to look at (rather than old press releases) and I find it hard to believe existing IBOs have not seen it. They might not realise the partnership is with UNICEF but they surely must know about the one by one projects. I also wonder if it is ethical if they don’t know that a proportion of their fees go towards this project.
I have also had a look at your website. You say you don’t work for Amway or Alticor yet it seems you have a great desire to protect them. It is not clear from your comment here or your website what your relationship is to Amway/Alticor, which makes me wonder. The cynic in me anyway!

Capital is always polarised and centralised. Not justly and proportionally distributed. CSR (or other terms like USO or PSB or anything goes to ‘unwind’ the centralised tendency of monies) is one legal way. I agree with Emet, yet there are always ways for any commercial entity to polarise or enhance more of its profits. Monopoly is the keyword. In the toilettries market, for example, when Amway cannot compete with price, yes they would compete with other ways.

If Amway wants to share its profits to Africa, just make sure they are not distributing junk products (reject products, worse, what if products of failed experiment?). Make sure also, Amway not just doing an effort of money laundering. There’s always THIS spirit of monies, no color, no race of whatsoever.

Sorry for the very late reply on this. My relationship is I’m an Amway Independent Business Owner (IBO). Essentially that means I market their products through my own business. In other words, I make a profit through reselling their products, but I don’t work for Amway.

The Amway/Alticor One-by-One website is a fairly new one, it’s been posted after a great deal of encouragement by Amway/Quixtar IBOs like myself to get stuff up on the ‘net about all these great things the company does. To date the ‘net has mostly been the domain of folk with too much spare time who devote it to criticising a much misunderstood business model. Which is also the motivation for my website!

Your comments about company directs and profit are partially correct. However, it applies to public companies, not privately held ones like Amway, who can do as they please with their money.